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Columbia Law/Tech JournalSun, 01 Mar 2015 18:36:29 +0000en-UShourly1http://wordpress.org/?v=4.1.1Cy Pres Remedies in the Internet Privacy Class Action Contexthttp://stlr.org/2014/03/16/cy-pres-remedies-in-the-internet-privacy-class-action-context/
http://stlr.org/2014/03/16/cy-pres-remedies-in-the-internet-privacy-class-action-context/#commentsSun, 16 Mar 2014 14:49:41 +0000http://www.stlr.org/?p=2618Continue Reading →]]>Last November, the Supreme Court denied certiorari in Marek v. Lane, a class action case concerning potential privacy violations arising from Facebook’s short-lived and controversial “Beacon” program, which automatically posted information regarding users’ transactions on third-party websites to the users’ Facebook feeds. The class action ended in a settlement, in which Facebook agreed to pay $9.5 million into a cy pres fund to “establish a charitable foundation” that would “fund organizations dedicated to educating the public about online privacy.” Class counsel would receive 25%, roughly $3 million. The new foundation would include a Facebook representative as one of its three board members. Affected users, the members of the class, would receive no direct compensation. Chief Justice Roberts published a statement expressing concern regarding the settlement, stating that the Court would soon need to address questions of when such cy pres remedies are appropriate and whether such settlements are fair.

This type of charity fund cy pres settlement should sound familiar to all Gmail users who tried out the now-defunct Google Buzz in February 2010. In November of that year, a Northern District of California judge approved a settlement in the Internet privacy class action lawsuit regarding Google Buzz’s automatic sharing of users’ Gmail contact lists. Generally, in class action settlements between major companies and classes comprised of large groups of customers, individual customers receive some kind of direct compensation, even if the amount is negligible or the payment comes in the form of coupons rather than cash. However, instead of compensating affected users directly, Google paid out $8.5 million to an “independent fund,” to “support organizations promoting privacy education and policy on the web.” Plaintiffs’ class counsel requested 25% of the settlement fund, or roughly $2 million, to cover attorneys’ fees and expenses.

Charity fund cy pres settlements such as those in the Facebook and Google Buzz cases described above raise various questions of fairness to class members in addition to implicating common criticisms of the class action device. This type of cy pres settlement is becoming increasingly common in class actions involving Internet privacy violations by companies such as Google, Netflix, and Facebook. The use of cy pres settlements in cases involving Internet privacy issues is thus among the trends that led Chief Justice Roberts to express concern with the cy pres settlement format.

One of the main problems with these cy pres settlements is one of fairness to class members. In general, courts are amenable to cy pres fund settlements in cases where “direct payments to the members of the putative class may be impractical,” perhaps because that class is too numerous. Courts generally agree that the distribution of cy pres awards to related charities (such as those educating users on Internet privacy) provides benefits, albeit indirectly, to the class and permit such awards for that reason. Because Internet privacy class actions involve such a large number of users, distributing part of the award to individual class members could easily be too costly or logistically impractical. Thus, courts have become more willing to approve settlements that give none of the award to class members as compensation. Intuitively, this seems unfair, particularly in the context where the Google Buzz lawsuit was broad under a statute providing for damages of up to $1,000 per violation.

An additional problem is that the method for distributing the awarded cy pres funds appears to allow Facebook and Google to direct funds to groups that they already support. As Consumer Watchdog reported, the Google Buzz settlement funds would likely be considered “tax-deductible donations” from Google to groups such as the MacArthur Foundation and the Stanford Center for Internet and Society, already “favored charities” of Google. Facebook’s settlement, on the other hand, sets up a new privacy foundation that would have a Facebook employee as part of its board. Because the settlement would create a new entity, its ability to benefit class members remains unclear. Both settlements seem to benefit the defendants more than the class members, thus appearing unfair.

Finally, given that class counsel in both the Facebook and Google Buzz cases stood to collect a substantial $2-$3 million from these awards, these cy pres settlements implicate the common criticism that class actions are merely a way for plaintiffs’ attorneys to profit while class members gain very little. This is a valid criticism in the context of the Facebook and Google settlements, when individual plaintiffs received no direct compensation even as plaintiff’s class counsel received substantial attorneys’ fees.

Scridb filter]]>http://stlr.org/2014/03/16/cy-pres-remedies-in-the-internet-privacy-class-action-context/feed/0Freeing the Market in Silicon Valleyhttp://stlr.org/2014/03/06/freeing-the-market-in-silicon-valley/
http://stlr.org/2014/03/06/freeing-the-market-in-silicon-valley/#commentsThu, 06 Mar 2014 13:51:26 +0000http://www.stlr.org/?p=2589Continue Reading →]]>Silicon Valley is known for being home to tech giants such as Apple and Google. These companies, and others like them, set the bar for technological innovations which are generated by and depend upon the hard work of thousands of employees. The Valley is vaunted for its respect for the power of an individual’s idea, and these types of success stories have characterized the area for decades. Why then, in this culture of respect for employees, did more than 60,000 of them seek (and receive) a class certification to sue companies including Apple, Google, Intel, and Adobe for antitrust violations?

The class of employees, which originally sought certification in mid-2011, pursues charges against the aforementioned companies for no-poaching agreements that served to prevent increased employee salaries. The allegations and certification have been largely supported by a number of emails between high-level executives at these companies, especially Apple and Google. These emails indicate that the companies, beginning around 2005, had entered into informal, but strongly enforced, agreements which interfered with fair competition. Recruiters at Google, for example, were apparently given “Do Not Call” lists populated with both current and former employees from Apple. In 2007, Steve Jobs, the late CEO of Apple, emailed Google CEO, Eric Schmidt, indicating that a Google recruiter had violated their agreement; the recruiter was apparently fired within the hour.

The impact of these companies’ actions is not trivial. The alleged agreement places serious limits on the free market as a whole, and more specifically, has a significant impact on Silicon Valley employees. These employees, the people responsible for so much of the region’s technological output, have a severely reduced ability to leverage their ideas and skills for higher pay; this results in a serious disincentive for employees to further technological growth. While it is possible to pursue growth and innovation via the start-up route, this road is a difficult one to travel, and monetary payoff is uncertain. In addition, companies may have feared violating the informal agreement and incurring the wrath of Jobs or other company executives. Because of this, they might have been unwilling to hire an applicant who previously worked at one of the other specified companies, making it harder for employees to switch jobs.

A few of the originally accused companies (Pixar, Lucasfilm, Intuit) reached a settlement after the original suit was filed in 2011. The class was initially denied certification in early 2013, but in October of 2013, U.S. District Court Judge Lucy Koh certified the class. Defendant companies appealed the certification, objecting that the class was too large and varied. Indeed, the class covers employees at seven companies in the Silicon Valley holding thousands of different job titles. Regardless, in January of this year, the U.S. Court of Appeals for the 9th Circuit let Judge Koh’s certification stand. The case is set to be heard on May 27th, but the certification of the class and subsequent denial of defendants’ appeal to decertify may put some settlement pressure on the defendants. The damages in the case could be as significant as $9 billion: tech employees in the Valley are frequently paid in the six figures, and whatever finding of suppression of pay would be multiplied across more than 60,000 employees who are part of the class.

It will be interesting to see what impacts, if any, this case will have on companies such as Apple and Google. On a broader scale, will companies gravitate towards different markets than the Silicon Valley, where this type of collusion may appear to be common practice? Now we must wait to see whether the companies, if they go to trial, will be found guilty of these antitrust violations that directly contradict the core free-market principles that made the Silicon Valley a haven for bright entrepreneurs.

Scridb filter]]>http://stlr.org/2014/03/06/freeing-the-market-in-silicon-valley/feed/0How Should International Purposeful Availment Grow with the Internet?http://stlr.org/2013/11/12/how-should-international-purposeful-availment-grow-with-the-internet/
http://stlr.org/2013/11/12/how-should-international-purposeful-availment-grow-with-the-internet/#commentsWed, 13 Nov 2013 02:50:29 +0000http://www.stlr.org/?p=2452Continue Reading →]]>Courts have used internet activity to find personal jurisdiction in the United States. Many of these cases have relied on either the Zippo test from Zippo Manufacturing Co. v. Zippo Dot Com, Inc or the Calder test from Calder v. Jones. The Zippo test applies a sliding scale where a court looks at the interactivity versus passivity of a website to find purposeful availment and is considered to be the main standard in internet jurisdiction cases. The Calder test has been used to determine if a website is targeting a specific forum state even if the website lacks enough Zippo interactivity. Although the case law of internet purposeful availment between states in America is well developed, the increased global use of the internet has brought about new issues in the law. Will a company with an interactive website in Russia or the United Kingdom be able to be sued in those forums? Recently, Google has refused service in the U.K. for a privacy lawsuit brought by internet users in that country. In this still pending litigation U.K. users want to sue Google for alleged privacy violations when Google is run on Safari web browsers. This is a similar claim to an American class action law suit last August where Google agreed to pay out $22.5 million. This lawsuit highlights the growing relevance of internet based international purposeful availment. I believe that an adoption of the Zippo test will significantly raise liability independent of company size, but an adoption of the Calder test will raise liability proportional to the size of the internet using company.

If the Zippo test is adopted, legal costs for all companies that use an interactive website will rise considerably. Currently many startup companies are trying to innovate America and the world with interactive websites of all kinds. When these sites go on the world wide web they can be easily accessed anywhere. Personal jurisdiction in America was expanded slowly because a foreign party would be an outsider to the court and the foreign party would have to pay more to defend a lawsuit in another state. These concerns grow exponentially when one defends a suit halfway across the world. A large company would likely have foreign connections, the capital to translate documents and would likely not be unknown to foreign citizens, but the unfairness presented to any small or startup company would be astronomical. This could lead to frivolous litigation which would deter startups from creating interactive internet innovation.

On the other hand, an expansion of Calder liability would not be as unfair to defendants. Targeting a particular market suggests that the company has connections and language skills in a particular forum which would make purposeful availment in that forum less burdensome. Additionally, larger companies will likely target more forums so the defendants which are best able to handle complex litigation will likely have the most purposeful availment. These companies will be able to vigorously defend claims against them and thus will disincentivize the creation of frivolous litigation. Cases like Yahoo! v. LICRA have followed this doctrine in the reverse direction granting American jurisdiction to a foreign group.

While it is difficult to speculate on how the international internet purposeful availment doctrine will develop in the future, I would support the expansion of the Calder doctrine above the Zippo doctrine. International litigation can be significantly more expansive, unfair and burdensome to parties so jurisdiction should be granted cautiously. Also, whereas in the past a business would likely have to have physical goods arrive to foreign customers to be subject to personal jurisdiction in that location, today parties easily enter forums since the world wide web layer of the internet is truly global and largely public. The global nature of the internet and great costs associated with international litigation should direct future purposeful availment doctrine.

Scridb filter]]>http://stlr.org/2013/11/12/how-should-international-purposeful-availment-grow-with-the-internet/feed/0Is Netflix’s “Watch Instantly” Streaming Service Statutorily Discriminatory Against the Deaf? The Answer is Yes and No.http://stlr.org/2013/02/14/is-netflixs-watch-instantly-streaming-service-statutorily-discriminatory-against-the-deaf-the-answer-is-yes-and-no/
http://stlr.org/2013/02/14/is-netflixs-watch-instantly-streaming-service-statutorily-discriminatory-against-the-deaf-the-answer-is-yes-and-no/#commentsThu, 14 Feb 2013 15:44:36 +0000http://www.stlr.org/?p=2034Continue Reading →]]>Netflix has established itself as the world’s premier on-demand Internet streaming media service, with thousands of movies and TV episodes available for unlimited and instant download and more than 33 million subscribers around the world. Yet, despite its overall popularity, over the past year Netflix has found itself defending against allegations that its “Watch Instantly” video stream service is statutorily discriminatory against deaf and hearing-impaired subscribers in Nat’l Ass’n of the Deaf v. Netflix, Inc., 869 F. Supp. 2d 196 (D. Mass. 2012) and Cullen v. Netflix, Inc., 880 F. Supp. 2d 1017 (N.D. Cal. 2012).

Background

In both Nat’l Ass’n and Cullen, the district courts analyzed whether Netflix violated the Americans with Disabilities Act (ADA), which requires that “[n]o individual shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation by any person who owns, leases (or leases to), or operates a place of public accommodation.” 42 U.S.C. § 12182(a). The basis for both lawsuits originated from Netflix.com offering only a limited amount of streaming media content available with closed captioning to assist the deaf and hearing impaired by providing readable text of the audio of movies and TV programs. According to the plaintiffs in both cases, the unavailability of closed captioning for all streaming media content on Netflix.com constituted a failure by the company to provide equal access to deaf and hearing impaired subscribers in violation of the ADA’s prohibition against discrimination on the basis of a disability.

Thus, the central inquiry facing the two district courts in Massachusetts and California was whether an Internet website fell under the umbrella of a “place of public accommodation” pursuant to the ADA.

Netflix’s Streaming Service Discriminatory in Nat’l Ass’n

In Nat’l Ass’n, the plaintiffs National Association of the Deaf, the Western Massachusetts Association of the Deaf and Hearing Impaired and Lee Nettles, a deaf person and a member of both non-profit organizations sought injunctive and declaratory relief requiring Netflix to provide closed captioning for all of its Watch Instantly content on its website. Netflix responded by filing a motion for judgment on the pleadings, arguing that the plaintiffs’ complaint failed to allege sufficient facts to establish a discrimination claim under the ADA.

The court held that Netflix.com was a place of accommodation underneath the ADA and rejected the motion for judgment on the pleadings. In reaching this conclusion, the court relied heavily on Carparts Distrib. Ctr. v. Auto Wholesaler’s Assoc., 37 F.3d 12 (1st Cir. 1994)(holding that places of public accommodation are not limited to actual physical structures), to rebut Netflix’s argument that websites and streaming video services were not intended to be places of public accommodation under the ADA. Citing Carparts, the court noted that “[i]t would be irrational to conclude that persons who enter an office to purchase services are protected by the ADA, but persons who purchase the same services over the telephone or by mail are not. Congress could not have intended such an absurd result.” Nat’l Ass’n, 869 F. Supp. 2d 200.

According to the court, the Carparts reasoning was also applicable to web-based services. Therefore, Netflix’s “Watch Instantly” website could potentially qualify for as many as three of the twelve enumerated ADA categories for “places of public accommodation”: A “service establishment” because subscribers are allowed to access the streaming video service via the internet; a “place of exhibition or entertainment” as Netflix.com offers movies, TV shows, and other media content; and a “rental establishment” in that Netflix engages subscribers to rent movies and TV shows.

The court also found unpersuasive Netflix’s argument that because the Watch Instantly website is accessed only in private residences, it could not be considered a place of public accommodation. As observed by the court, “the ADA covers the services “of” a public accommodation, not services “at” or “in” a public accommodation”. Id. at 201.

Cullen Court Finds Netflix’s Streaming Service Non-Discriminatory

Faced with essentially identical facts and claims asthose presented in Nat’l Ass’n, the court in Cullen arrived at a different conclusion in regards to Netflix’s obligation to provide its subscribers with closed captioning for media content on its Watch Instantly website.

The named plaintiff David Cullen – representing a class of deaf and hearing-impaired Netflix subscribers – brought suit alleging violations of California’s Unruh Civil Rights Act (Unruh) and Disabled Persons Act (DPA), which by their statutory definitions are only violated when the ADA is violated. Netflix responded with a motion to dismiss Cullen’s action.

Despite acknowledging the decision in Nat’l Ass’n, the Cullen court recognized that as a district court, it was bound to adhere to Ninth Circuit precedent in the absence of a Supreme Court ruling on an issue. 880 F. Supp. 2d 1023. Consequently, the court relied heavily on the standard set forth in Weyer v. Twentieth Century Fox Film Corp., 198 F.3d 1104, 1114 (9th Cir. 2000), which held that only actual physical places could be considered places of public accommodation under the ADA.

In consideration that the media content on Netflix’s Watch Instantly website could only be accessed by subscribers via an internet connection, the court found that Netflix.com was not “an actual physical place”. Therefore, under the precedent established by Weyer, the court held that Netflix.com was not a place of public accommodation and granted Netflix’s motion to dismiss.

Future Implications of Both Cases

In an increasingly wireless world where many businesses offer diverse entertainment, services and products for purchase by consumers online, the development of the law on the issue of whether a place of public accommodation must be a physical establishment under the ADA will be a significant one to follow. As demonstrated in Nat’l Ass’n, some courts might consider the modern climate in which business and service transactions occur and apply the ADA to provide meaningful protections to disabled online consumers. Other courts might feel compelled to ignore the growing trend of e-commerce and follow traditional precedents, as was the case in Cullen. Either way, given the uncertainty that exists in regards to how courts will interpret and rule on the place of public accommodation issue, one thing appears clear: web-based businesses should begin to consider how to make their websites and services more accessible to the disabled in order to avoid finding themselves potentially defending against a violation of the ADA.

Scridb filter]]>http://stlr.org/2013/02/14/is-netflixs-watch-instantly-streaming-service-statutorily-discriminatory-against-the-deaf-the-answer-is-yes-and-no/feed/0Smartphone Wars: Part IIhttp://stlr.org/2012/09/28/smartphone-wars-part-ii/
http://stlr.org/2012/09/28/smartphone-wars-part-ii/#commentsFri, 28 Sep 2012 13:25:48 +0000http://www.stlr.org/?p=1927Continue Reading →]]>On August 24th, Apple won decisively in Apple v. Samsung. The jury awarded Apple $1.04 billion for infringing Apple’s intellectual property. This was less than the $2.5 billion that Apple requested, but the jury found that Apple wasn’t infringing any of Samsung’s patents. Of the many patents that were disputed, the judgment turned on three patents and Apple’s trade dress argument. The pertinent features were the following: (i) bounce-back effect; (ii) pinch-to-zoom feature; and (iii) tap-to-zoom feature.

This is not the end of the story, of course. As the case developed in the United States, Apple and Samsung were, and continue to be, in a legal battle all over the world. Seoul Central District Court compromised and ruled that Samsung didn’t copy the look and feel of Apple. It further ruled that Apple had infringed upon some of Samsung’s wireless technology, while Samsung had violated Apple’s bounce-back effect. The result was a light slap on the wrist. Both companies had to pay a minimal amount in damages and had some of their older devices banned. More recently on September 21, 2012, a German court ruled that Samsung’s products didn’t violate Apple’s patents.

The discrepancy between the federal jury decision and those of other international courts brings into question whether juries are equipped to handle these types of technical cases. The jury instruction was reportedly over 100 pages, but the jury was able to deliberate after only 3 days. Of course, patents are not the only technical subject where the jury has a say, and there may have been other factors that led to these differing opinions, such as having a home court advantage.

Regardless, Apple and Samsung plan to continue the case in the US. Apple reportedly has been seeking about $700 million in additional damages and a permanent injunction preventing the sale of several of Samsung’s products, while Samsung plans to appeal the verdict and may include a patent infringement claim for violation of Samsung’s patents in LTE technology. LTE is a technology that provides faster connectivity than the standard 3G technology included in the previous generations of iPhones and is included in the new iPhone 5.

Stakes are very high for both companies as they continue their legal battle. There are many differing arguments as to whether patents on software and the magnitude of Apple’s award really promote innovation and new inventions. However, it is important to note that most of the claims were directed towards Samsung’s implementation of Android and Google has already responded to the lawsuit by making changes like implementing a new way to integrate pinch-to-zoom in its latest software.

Furthermore, it likely gives a window of opportunity for Microsoft and Nokia, which increases consumers’ choices. Nokia has opted to stop the development of its own software and decided to bet its future on Microsoft’s new Windows 8 platform. Microsoft’s operating system features a completely different interface and Nokia’s Lumia phones sport a distinct look. While Microsoft has had trouble gaining traction, this controversy could arguably help Nokia and Microsoft’s push to be more main stream.

The mobile market is one of the fastest growing areas in technology. Despite the fact that software patents are controversial and the boundaries are not fully defined, with more companies trying to tap the growing market, consumers will see a lot of new options in the market.

Scridb filter]]>http://stlr.org/2012/09/28/smartphone-wars-part-ii/feed/0Smartphone Warshttp://stlr.org/2012/04/10/smartphone-wars/
http://stlr.org/2012/04/10/smartphone-wars/#commentsWed, 11 Apr 2012 02:51:08 +0000http://www.stlr.org/?p=1812Continue Reading →]]>Apple sues Samsung for patent infringement. In response, Samsung files international countersuits on patents of its own. Courts around the world grant preliminary injunctions to each company on a number of their claims, while United States and European Union government agencies investigate allegations of antitrust violations. What’s going on here? Let’s start with the shiny new weapon that Apple added to its arsenal in June of last year: a patent on the original iPhone, the paperwork for which had been in the works since December of 2007. That patent claims, among other things, the finger-gesture-based set of input methods that has become integral to the functionality of today’s smartphones. Enter Samsung, now the world’s largest manufacturer of smartphones and owner of numerous patents covering globally standardized technological protocols. Samsung’s use of those input methods, as well as overlaps in product design, in its line of Android-based devices has put it squarely in Apple’s crosshairs.

Flicking your index finger up to scroll through an address book? Pinching a map or image to zoom out? Slicing watermelons to bits in Fruit Ninja? They’re all (arguably) covered by United States patent number 7966578 (“the ‘578 patent”). Though the capacitive touchscreen technology incorporated in the iPhone and most every modern smartphone is not itself claimed in Apple’s patent, the very means by which mobile phone users interact with that piece of hardware apparently is. The strength of the ‘578 patent has more recently been called into question by Judge Lucy Koh of the Northern District Court of California, who in October of 2011 ruled that although Samsung’s devices indeed infringe Apple’s patent, Apple still bears the burden of demonstrating the patent’s validity before relief may be granted. Judge Koh more recently denied Apple’s zealous bid to enjoin sales of Samsung smartphones and tablets in the United States.[i]

Apple has additionally based a significant portion of its legal battle against Samsung on similarities in design between the companies’ respective device families. In a recent and rather embarrassing courtroom exchange, Samsung’s attorneys themselves were unable to differentiate their new Galaxy 10.1” tablet from Apple’s iPad 2 while the two were held over the presiding judge’s head at a distance of ten feet. Samsung’s lead mobile device designer last week voiced offense at Apple’s allegations concerning such similarities, declaring, “the Galaxy [smartphone] is original from the beginning,” and the child of Samsung’s own independent efforts. Hardware design similarities are further aggravated by software-based visual overlaps, including the incorporation of rounded square icons in the modified Android operating system that ships with so many of Samsung’s new phones.

Adding fuel to the fire, Samsung filed numerous countersuits hinging on its ownership of patents in standardized technologies like 3G and UMTS communications protocols. That move was frowned upon in the European Union, where Samsung is presently being investigated by the European Commission’s Directorate-General for Competition for alleged antitrust violations on that basis. Due to the necessity of wide access to those industry-standard protocols, Samsung is legally required to license the manufacture of devices incorporating those technologies in a fair, reasonable, and non-discriminatory manner. Samsung’s attempts to secure injunctions against Apple in Europe have failed as a result of those protocol patents’ essentiality to cross-compatibility between different manufacturers’ devices and the wireless networks on which they reside.

So what does this all mean for consumers? Germany has granted a preliminary injunction against Apple’s sale of the iPhone, while Australia temporarily banned sales of Samsung’s Galaxy tablet. Apple’s litigation with Motorola over two patents unrelated to the Samsung dispute further prompted a German court to enjoin sales of certain Apple devices within its borders. German smartphone buyers are now faced with a market severely limited by the effects of these interwoven lawsuits. Samsung has further sought to enjoin the sale of Apple products in its home country of Korea, as well as in Italy, Japan, and a handful of other prominent markets. Indeed, the Apple-Samsung dispute now comprises at least 21 separate suits in ten countries. The outcomes of these lawsuits could have dire effects on the availability of the mobile technologies that consumers have already begun to take for granted.

Apple has never been friendly to the idea of licensing its technologies out to competitors, and unlike Samsung, does not hold patents subject to mandatory licensing under European Union law. Experts opined last year that Apple was trying to knock Samsung, HTC, and other prominent competitors as far down as possible in anticipation of the upcoming holiday season, but domestic sales figures have remained strong on all sides. Apple’s March 16 release of the iPad 3 brought with it nearly $1.5 billion in revenue when upwards of three million units were sold over the opening weekend. If not for the fact that Android device sales significantly eclipsed iOS units’ in 2011, Apple would not appear to need any additional assistance in securing mobile device market share.

As much as Apple fanboys (and girls) would love to see the company’s family of i-devices remain at the top of the pack, some argue that litigation wins on these patent and trademark issues could spell disaster for competitive, and therefore innovative, markets. Google’s Android operating system, which relies heavily on the methods of use allegedly covered in Apple’s patents, would likely suffer significant immediate losses, presenting the risk that consumers will be forced into a “very closed world of Apple’s making.”

On the contrary, the mobile device market has developed so rapidly since Apple’s 2007 release of the original iPhone that Apple’s legal victories could work to usher the development of revolutionary new interfaces for the next generation of mobile devices. In developing its Kindle Fire, released in November of last year, Amazon worked hard to dodge intellectual property infringement issues by designing a tablet that is more easily distinguishable from the iPad than the Galaxy has proven in court. The device is notably smaller and incorporates a proprietary set of algorithms governing the use of pinch-zoom functions and the like. Consumers appear to have greeted Amazon’s device warmly as a marriage of low price and respectable functionality, though solid sales figures have been difficult to pin down. Whether it, along with other Android-based devices, will maintain strong market presence over the long term depends largely upon the wider impacts of the Apple-Samsung litigation and concurrent government antitrust investigations.

Additional considerations in the present round of litigation include the fact that Apple is one of Samsung’s biggest parts consumers, regularly buying huge quantities of capacitive touchscreens and semiconductors from the vertically integrated Korean giant. Samsung further owns patents in the iPhone 4S antenna design, but has yet to use this ammunition to its advantage in the present rounds of litigation. How these factors play into the smartphone wars is a dynamic yet to be observed, but here’s hoping that whatever happens means more and cooler options at market in the months to come!

[i]Blog Editor’s Update: The oral argument for the appeal of this case before the Federal Circuit, which took place on 6 April 2012, can be heard here.

Witnesses in the United States may choose to exercise their right to “plead the Fifth,” or refuse to answer a question because the response could provide self incriminating evidence of an illegal act. But how strong is this right if a prosecutor is already aware of where a witness was, what they saw, what they heard, and in some ways even what they were thinking at any given time on any given day? I do not refer to torture, truth serums, or the recent accomplishment of Berkeley scientists in creating visual pictures from brain waves. Rather, I refer to smart phones and the growing field of “reality mining” or “mobile phone sensing.”

The Progression of Mobile Phone Technology

Mobile phones had a humble beginning in 1973. Unlike modern iterations, the first mobile phone was bulky, difficult to transport, and had but one function; it allowed you to make a phone call. Technology has rapidly progressed from 1973, and today’s smart phones come rich with functionality through the use of embedded sensors. For example, the Apple iPhone comes equipped with an accelerometer, gyroscope, GPS, digital compass, ambient light detection, and dual microphones and cameras. These sensors give the iPhone the ability to speak, listen, locate, give directions, detect movement etc… The new iPhone4S also responds to natural language queries.

“Mobile phone sensing” makes use of these digital senses to enable smart phones to become even more dynamic. Dartmouth College’s Smartphone Sensing Group
describes it as “turning the everyday smart phone into a cognitive phone by pushing intelligence to the phone and the computing cloud to make inferences about people’s behavior, surroundings and their life patterns.” The practical applications of this field seem enormous:

Researchers at Dartmouth college describe examples such as 1) using accelerometer data to automatically recognize different activities (e.g., running, walking, standing), 2) combining accelerometer data with location estimates from a phone’s GPS to recognize the mode of transportation such as walking, biking, driving, taking a bus or riding the subway and 3) continuously collecting audio from a phone’s microphone to “classify a diverse set of distinctive sounds associated with a particular context or activity in a person’s life, such as using an automated teller machine, being in a particular coffee shop, having a conversation, listening to music, making coffee, and driving.” Amongst a laundry list of other applications, this data can be translated into suggestions for how to avoid traffic, increase social networking, and for personal health care by tracking your physical activity or the number of times you’ve visited your doctor’s office.

An Oregon based technology company, Digimarc, has developed an application that uses a mobile phone’s camera and microphone to “detect digital watermarks encoded into magazines, newspapers, packaging and other printed materials, as well as identify songs in music and read QR codes.” Mobile phones can then recognize what it is that a user is looking at or listening to and make personalized suggestions.

Sandy Pentland (a leader in the field of mobile phone sensing and director of MIT’s Human Dynamics Laboratory) predicts that mobile phone sensing may be able to give clues to diagnosing depression by detecting changes in speech patterns, or using a phones motion sensors to reveal slight changes in gait, potentially acting as an early indicator of ailments such as Parkinson’s disease.

Smart Phone as a Witness

Yet these examples may not be the limit to what mobile phone sensing may be used for in the future. It seems possible that future criminal (or civil) trials may not need live witnesses so long as the sensor data from an accused individual’s smart phone was admissible as evidence. Before a word was said, it could be known where the individual was, who they were with, what they were looking at, listening to, talking about etc… Not just the day that a crime was committed, but days, weeks, or months in the past. These seem to be the personal experiences that individuals were traditionally allowed to protect to avoid self-incrimination.

Conclusion

The Fifth Amendment is concerned with what an individual must be witness to after a crime is committed, rather than before. Ex ante choices such as planning to commit a crime do not bar a person’s right to avoid self-incrimination. Thus a person who purchases a smart phone in order to utilize the advantages of mobile phone sensing (or for whatever other reason) should not diminish their rights under the Constitution. When we look ex post, the experiences that a phone interprets are the users, the senses that it has are digital extensions of the individuals. Those experiences and senses is what the Fifth Amendment is concerned with and should not be allowed as evidence of a person’s guilt.

Scridb filter]]>http://stlr.org/2011/11/21/your-smartphone-a-prosecutors-best-witness/feed/1AT&T Says One Antitrust Suit is Enough!http://stlr.org/2011/10/17/att-says-one-antitrust-suit-is-enough/
http://stlr.org/2011/10/17/att-says-one-antitrust-suit-is-enough/#commentsMon, 17 Oct 2011 10:00:09 +0000http://www.stlr.org/?p=1633Continue Reading →]]>In the wake of the Justice Department’s antitrust suit to stop AT&T’s $39 billion acquisition of T-Mobile, Sprint Nextel (the nation’s 3rd largest wireless carrier) and Cellular South (a smaller wireless company in the Southeastern U.S., which changed its name to C Spire last week) filed similar suits seeking to enjoin the merger. The suits were filed under § 16 of the Clayton Act which provides injunctive relief for private parties. The suits by Sprint and Cellular South claimed that the merger would result in higher prices and reduced innovation in the wireless industry. On September 30th, AT&T filed 12(b)(6) motions to dismiss the Sprint and Cellular South suits.

AT&T presented three main points designed to show that the cases by Sprint and
Cellular South should be dismissed. First AT&T argues that because Sprint and Cellular South are competitors—not consumers—in this market, both lack standing to bring an antitrust suit. The economic justification behind enjoining a horizontal merger among competitors, such as AT&T and T-Mobile, is based on the theory that the merger will lead to a more concentrated and less competitive market which will, in turn, lead to higher prices and reduced innovation. AT&T argues that even if the merger were to result in less competition and higher prices—a result AT&T says would not occur—any losses would be felt by consumers not competitors. AT&T goes on to argue that what Sprint and Cellular South are actually concerned about is increased competition from a more efficient unified AT&T/T-Mobile. AT&T argues that antitrust law does not provide any recourse for a competitor’s concern about losses resulting from a rival’s increased efficiency and competitiveness. AT&T also submitted a very powerful piece of evidence against Cellular South in this case. In their motion to dismiss the case, AT&T included an email it received from Hu Meena, CEO of Cellular South. Mr. Meena wrote that if the companies came to an agreement through which Cellular South would build a next generation LTE network in Mississippi which AT&T would use for roaming, and AT&T guaranteed reasonably priced access to its networks for Cellular South’s roaming needs for the next 10 years, Cellular South’s antitrust concerns would be alleviated. AT&T used the email to suggest that Cellular South was exploiting the lawsuit as a way of advancing its own strategic interests.

AT&T’s second point is a response to claims by Sprint and Cellular South that an AT&T/T-Mobile merger will reduce Sprint’s and Cellular South’s access to new wireless devices. Sprint and Cellular South argue that after the merger AT&T will be able to “coerce exclusionary handset deals” from device manufacturers effectively freezing competitors out of the market. AT&T responds that it is well recognized that exclusive handset deals are generally pro-competitive and encourage company differentiation. The only way that exclusive deals hurt competition is when they allow one party to unreasonably deprive another of access to goods. AT&T argues that such an outcome is extremely unlikely in this market as there are a great variety of handset manufacturers who produce many different handset models. Between 2006 and 2010 the number of handset manufacturers that distribute their products in the U.S. market increased from 8 to 21 and these manufacturers produced 302 different models. Therefore, AT&T contends that Sprint and Cellular South failed to provide any factual allegations which indicate they would be frozen out of the handset market.

AT&T’s final point was in response to claims by Sprint and Cellular South that the merger would have an effect on the market for roaming services. AT&T argues that Sprint fails to point to any effect on a market for roaming services in which Sprint is a participant. Sprint does not currently purchase roaming services from either AT&T or T-Mobile, nor would it be possible for them to do so. Sprint’s cell phone network uses CDMA technology which is incompatible with the GSM technology used by AT&T and T-Mobile. Cellular South uses GSM service for less than 3 percent of its customers and fails to show that it would be affected. AT&T goes on to argue that any claims by Sprint or Cellular South which state that the merger would increase the price they pay for Verizon roaming services lack any factual basis. AT&T argues that both Sprint and Cellular South are ignoring the fact that FCC regulations require all mobile wireless carriers to provide roaming on a just, reasonable and non-discriminatory basis.

Regardless of how one feels about the competitive effects of an AT&T/T-Mobile merger on the wireless industry, whether there is anything to gain by allowing Sprint and Cellular South to sue on the back of the DOJ is a separate question. The DOJ and the seven state attorneys general which have joined in the suit (New York, Washington, California, Illinois, Massachusetts, Ohio and Pennsylvania) seem well positioned to represent the welfare of wireless consumers and it is difficult to see what additional benefits would be provided by allowing wireless companies, primarily concerned with the merger’s effects on their own bottom lines, to sue as well. It is now up to Sprint and Cellular South to show why their suits should be allowed. Oral arguments in the case are schedule for October 24th.

The Electronic Frontier Foundation provides analysis on the recent Capitol Records v. MP3Tunes opinion issued by the New York Southern District. The court held that file de-duplication on cloud-based music services falls within the safe harbor provisions of the DMCA. The decision will lead to reduced costs for online music locker service providers.

Scridb filter]]>http://stlr.org/2011/09/06/stlr-link-roundup-september-6-2011/feed/1Wounded Soldiers Returning Home Face a New Battlehttp://stlr.org/2010/02/09/wounded-soldiers-returning-home-face-a-new-battle/
http://stlr.org/2010/02/09/wounded-soldiers-returning-home-face-a-new-battle/#commentsTue, 09 Feb 2010 14:53:51 +0000http://www.stlr.org/?p=817Continue Reading →]]>Some wounded soldiers leaving the war-zones in Iraq and Afghanistan have arrived home only to find themselves caught in the crossfire of a new battle – a legal one. For some of the 300,000 or more members of the armed forces who suffer from post-traumatic stress disorder (PTSD), the legal battle ensuing from the Veterans Administration’s denial of long-term disability benefits is extremely important. Without these government benefits, vulnerable veterans who are not prepared to return to the workplace may be forced to out of financial necessity.

In December 2008, seven veterans with PTSD brought a class action suit in federal court alleging that the VA had incorrectly evaluated their claims for long-term disability benefits. The alleged mis-evaluation resulted in some claims receiving low disability ratings (leading to lower payments) and others being denied entirely. The court has since ordered that notice of the class certification and pending action be mailed to approximately 4,300 service members who were discharged from service because of their PTSD and then denied long-term disability benefits. This litigation comes just a year after an internal VA email surfaced wherein an employee suggested to the agency that the it should “avoid giving a diagnosis of post-traumatic stress disorder for veterans and instead consider giving a diagnosis that might result in a lower disability payment.” This controversy aside, this litigation illuminates a vulnerability which makes the disability claims of these veterans particularly susceptible to attack – psychological disorders that lack an identifiable basis in hard science are difficult to objectively verify and evaluate.

New Developments in Diagnostic Technology May Prove to be the Weapons that Veterans Need to Fortify Their Position

According to the National Institute of Mental Health, PTSD is a recognized psychological disorder that may arise in an individual after he or she witnesses or experiences a dangerous event. Such events include combat, physical/sexual assault or abuse, an accident or a disaster. As a result of witnessing or experiencing the trauma, the individual with PSTD may relive it through flashbacks or nightmares. In addition, individuals with PTSD will present with a range of avoidance tendencies (e.g. feeling emotionally numb or avoiding reminders of the event) and hyper-arousal (e.g. being easily startled or feeling “on edge”). Until now, PTSD has been traditionally diagnosed by identifying these categorical symptoms in a given individual for a certain period of time after the occurrence of the traumatic event. Though the diagnosis is guided by the DSM-IV, it has been regarded by some as essentially a “crap shoot”. In particular, because the presentation of symptoms, the timeline for the onset of the disorder, and the degrees of impairment can vary widely patient to patient, diagnosing PTSD with a sniper-like precision can be a difficult task for clinical practitioners. The imprecision of diagnosis is compounded by the fact that no biological markers (or biomarkers) exist for PTSD, meaning that they cannot be verified and evaluated objectively like other diseases, such as cancer.

Recently, however, Dr. Apostolos Georgopoulos (a researcher at the Minneapolis VA Medical Center and professor at the University of Minnesota) discovered, using magnetoencephalography (MEG) technology, a functional neural “biomarker” in veterans with PTSD. MEG is a brain imaging technology that measures the magnetic field generated by neurons when they fire. Because individuals with PTSD showed distinct synchronous neural firing patterns in the brains, Dr. Georgopoulous was able to use the technology to identify the functional neural pathway, and thereby distinguish between the brains of individuals with PTSD and the brains of healthy individuals. Remarkably, using MEG technology – which is non-invasive and harmless – Dr. Georgopoulous was able to identify the brains of PTSD subjects with an accuracy rate of 90% (also see this Journal of Neural Engineering paper, available for 30 days after publication). The innovative use of MEG technology coupled with synchronous neural interactions testing shows promise as a diagnostic method for PTSD.

Despite Upgraded Arsenal, Veteran Litigation May Come Down to a Battle of the Experts

Despite this new development, the veteran class action suit will likely come down to a battle of the experts. The strict standards for admitting novel scientific evidence set out by Daubert and its progeny are likely to be significant obstacles to plaintiff’s counsel. Under Daubert, in order to admit novel scientific evidence, a party must show that the evidence is not only relevant, but reliable. In determining whether scientific evidence is reliable, a party must prove that it was derived from valid scientific methodology. Proving the validity of scientific methodology requires a showing that the scientific theory or technique at issue be refutable or falsifiable, respectively, and subjected to peer review. Where empirical testing is at issue, Daubert requires that the party disclose the known or potential error rate of the technique as well as the existence and maintenance of standards and controls concerning its operation. Lastly, the party must prove that the theory or technique is generally accepted within the relevant scientific community.

In this case, the scientific research at issue is not only novel, but infant. This research is the very first of its kind, and as such, the scientific conclusions we can drawn there from are limited and likely conservative. Because Dr. Georgopoulous’ research focused on individuals who were already diagnosed as having PTSD, we cannot conclude that MEG imaging would be a scientifically valid way to diagnose the disorder. Further, while the research indicates that it is possible to identify PTSD-brains from non-PTSD brains, we cannot conclude that this possibility translates into an ability to distinguish PTSD-brains from brains impacted by other psychological or neuropsychological disorders. Lastly, this research does not indicate whether the brain scan would be effective as a diagnostic tool for recovered individuals who are no longer symptomatic. Thus, because this field of neuroscience is still in its infancy, it is inherently unreliable and it will not likely be able to withstand a Daubert challenge.

But, even if the scientific findings were admitted, their utility in evidence would be limited. Thus far, the use of MEG technology to detect PTSD has only been shown to confirm a diagnosis of PTSD; it does not indicate the severity of the individual’s condition. Therefore, in order to prove that a given veteran’s PTSD is qualitatively severe enough to warrant the high disability rating (which would in turn trigger a veteran’s entitlement to long-term benefits), the plaintiffs would need to supplement these findings with psychological expert testimony to meet their burden of proof.